In a statement, the Prince of Asturias Foundation described Dahrendorf as "the leading representative of contemporary European liberal thought."
He was elected to the German parliament 1969, and served as a foreign ministry secretary in the first government of Chancellor Willy Brandt.
A political scientist and economist, as well as a sociologist, much of his work centers on the questions of order and integration in modern society.
Author of many books, his most famous work is "Class and Class Conflict in Industrial Society" (1959).
Each year, eight Prince of Asturias prizes are awarded to Spaniards and foreigners alike in categories including arts, sports, humanities and science. The prize is named after Spain's crown prince, Felipe.
Previous social science award winners include former Irish President Mary Robinson, last year, and Italian sociologist Giovanni Sartori in 2005.
The awards are announced throughout the year and presented in a ceremony in the fall in Oviedo. Winners receive EUR50,000 (US$68,330) and a reproduction of a statue by Catalan sculptor Joan Miro.